E-Commerce

AT&T revamps data plan pricing, adds iPhone tethering

AT&T revamped its data plan pricing structure in a move that could force rivals to follow. Unlimited plans are gone, but most customers should make out on the deal.

This is a guest post from Larry Dignan of TechRepublic's sister site ZDNet. You can follow Larry on his ZDNet blog Between the Lines, or subscribe to the RSS feed.

AT&T on Wednesday carried out sweeping changes to its data plan pricing structure in a move that could force rivals to follow.

AT&T's move (statement) comes as analysts come around to the realization that the U.S. wireless subscriber market is saturated. The game is to keep the subscribers you have happy and that means better pricing and long-awaited perks like tethering.

Among the major changes from AT&T:

  • An entry data plan for $15 a month capped at 200 MB of data. AT&T says 65 percent of its users could get by with the $15 a month plan and cut their costs in half. Should you exceed your 200 MB cap then you get another 200 MB for $15.
  • A plan for $25 a month for 2 GB of data. This "DataPro" plan allows for an extra 1 GB of data for $10 should you go over the cap. AT&T said that 98 percent of its customers use less than 2 GB of data a month. That cap is hard to top.
  • Tethering will arrive on the iPhone and any other smartphone for $20 a month on top of a DataPro plan. Generally speaking, this set-up means a 2 GB plan with tethering for $45 a month total.
  • iPad customers will see their $29.99 unlimited plan replaced with the $25 a month DataPro plan. You still prepay without a contract.

As noted by Engadget most customers will make out on the new pricing model, which will be effective June 7. Some folks are mourning the passing of unlimited data plans, but frankly they were a bit academic. It's hard to surpass the targets the wireless carriers are setting and even if you do pass the caps, the charges are predictable.

Bottom line: Consumers aren't going to sweat unlimited plans if they can save a few bucks every month.

There's also a simplicity message here. AT&T's pricing is easier to follow now relative to what was there before even though service caps have a lower tier. Consider the new AT&T pricing compared to this mess:

Click the image to enlarge.

It should be interesting to see what rivals come back with.

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